Nightclub chain buys Chicago strip club — and entire building — for $11M

RCI Hospitality Holdings bought the VIP’s Gentlemen’s Club on the Near North side for $10.5 million, business and building included.

Along with VIP’s, the Houston-based chain of nightclubs and strip clubs bought the 10,000-square-foot building at 1531 North Kingsbury Street, according to Crain’s.

Founded in 1983 with one club in Houston, RCI went public in 1995 and now has a market capitalization of $299 million. It has forecast revenue of $166 million this year at its 40 clubs across the country. That would be up from $145 million in 2017.

VIP’s, which opened in 1993, is the only strip club in Chicago that is allowed to serve liquor.

Club owner Perry Mandera will receive $4 million for the property, $6.5 million for the business and is providing $4.5 million in seller financing for the deal, RCI told Crain’s.

Strip clubs and other adult business often have a hard time securing traditional financing. The landlord of a building that houses an RCI club in New York, for instance, was able to secure a loan, but at a much higher rate than other borrowers were paying.

Mandera, who declined comment to Crain’s, also owns a suburban trucking and distribution business and a medical marijuana dispensary near the Illinois Medical District. [Crain’s] — John O’Brien